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Capital spending increases for 4th straight quarter

Jiji Press TOKYO (Jiji Press) — Nonfinancial companies’ combined capital expenditures grew for the fourth straight quarter in July-September, led by brisk spending by nonmanufacturers, government data showed Friday.

The sum rose 4.2 percent from a year before to ¥10,792 billion, the Finance Ministry said, beating the median forecast of a 3.5 percent increase among five economic research institutes surveyed by Jiji Press.

Spending by nonmanufacturers increased 5.9 percent, driven by sharp growth at the services industry, in which some hotel operators boosted expenditures on fresh construction and renovation, as well as the goods rental and leasing industry.

Manufacturers’ spending rose 1.4 percent on the back of brisk expenditures by electrical machinery makers to increase their capacity to make equipment for semiconductor makers.

Combined recurring profits rose 5.5 percent to ¥17,892.8 billion, hitting the highest level for July-September, thanks partly to strong sales of new vehicle models.

Manufacturers’ profits jumped 44.0 percent, lifted by strong performance at the transportation machinery sector and the chemical industry, which enjoyed strong demand for medical products, as well as the production machinery sector.

Nonmanufacturers posted a 9.5 percent profit decline, dampened by decreases at the services industry and the information and communications sector, which was hit by growing sales promotion costs amid intense competition.Speech

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